Paying Corporation Tax to HMRC

1. When an individual starts doing business, he / she must register the business for corporation tax. Unincorporated associations should write to HMRC.
2. The business must keep accounting records and books of accounts. The business must prepare a company tax return to compute the payable corporation tax.
3. Pay the corporation tax due or report to HMRC if no tax is due by the due date. This is normally nine (9) months and one (1) day after the end of the accounting period.
4. File the company tax return before the deadline. This is normally 12 months post the end of the accounting period.

The business must pay the corporation tax due or report to HMRC if no tax is due by the due date. This is normally nine (9) months and one (1) day after the end of the accounting period.

It is imperative that a company pays the tax due to the HMRC by the cut-off date. The HMRC may charge interest if the tax is not paid on time. On the other hand, HMRC will pay interest if they receive the tax early. The time period allowed depends on how the payment is made:

Same day or next day

• Telephone banking or online banking (Faster Payments)
• CHAPS

Three (3) working days

• At the post office
• At the bank
• Online by debit or credit card
• Direct debit
• BACS

Five (5) working days

• Direct debit

Note: Corporation tax cannot be paid by post. In case the cut-off date falls on a weekend or on a bank holiday, the company must make sure that the payment reaches the HMRC one day prior to the holiday.

It is possible to make multiple payments using CHAPS – An online CHAPS form can be used to make a single payment for multiple companies for the same accounting period.

The online corporation taxation service can be used to file the organisation’s or limited company’s tax return with HMRC. Businesses can also use this service to file accounts together with Companies House. There might be occasions when the online service is slow during peak business hours. To use the HMRC Corporation Tax service companies need:

• User ID and password provided for Government Gateway.
• Company accounts.
• Ready calculation of Corporation Tax.
• Supporting documents, such as claims for relief, if any.

Businesses will need the Companies House password and authentication code, if accounts are filed jointly with the Companies House.

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dns accountants help clients focus on maximising their wealth. It’s impractical to expect any small-business owner to have a comprehensive knowledge of tax and National Insurance rules, dns accountants work with businesses to work out their HMRC corporation tax dues and business tax planning.